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Understanding Home Insurance Deductibles: An Interview with Paul Diaz of Paul Diaz Insurance

By Paul Diaz

Tell us a little bit about your company and the services you offer.

We offer all forms of insurance and it's been a family business since 1978.

What is the definition of a home insurance deductible?

The home insurance deductible is what is paid prior to your coverage kicking in, in the event of a covered loss.

What are the two types of deductibles? Do these ever vary across different insurance companies?

You have several options for deductibles, the higher the deductible the less expensive the policy is.

How are deductibles determined? Is it more common for an insurance company to use fixed dollar amount or a percentage of my home's insured value?

Deductibles are sometimes determined by the lender based on a percentage of the loan, but more often than not it's determined by the homeowners and their risk tolerance.

What are the main advantages and disadvantages to choosing a higher deductible?

Insurance is for catastrophic events and most people don't have claims, so we suggest going with a higher deductible and saving a few hundred a year. Over the long run the annual savings usually cover the deductible in the event you have a loss.

What advice would you give to new homeowners who are shopping for home insurance but have a limited budget?

Put everything together, auto and home insurance to maximize discounts. Don't be cheap on insurance because it could financially crippling if you have a loss. Increase your deductible to save annually.

To contact and/or find out more about this company, please visit their services directory profile.

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